Hiring and employer duties

It is for anyone considering, planning or carrying out a move to Spain, including founders who want to know what employing people involves before they set up a company.

Start with "Hiring your first employee in Spain: what to register first". It walks you through what to register and in what order, so you onboard your first hire correctly.

After that, read about what an employee really costs beyond the salary, then how payroll works. Later articles cover health and safety duties, the duties that begin as your team grows, hiring discounts and subsidies, using a temp agency instead of hiring directly, and employing people from a foreign company with no Spanish entity.

Contract types, dismissal and severance, false self-employment and work permits are covered elsewhere, not here.

Key rules

• Registering a worker: You must register the worker with Social Security before they start work, and you can do it up to 60 days before the first working day.
• Contract communication: You must communicate the employment contract to the public employment service within 10 working days of the start of the employment relationship.
• Monthly contributions: You settle Social Security contributions every month, by the last day of the month in which the work is done.
• 50-worker threshold: At 50 or more workers you must have an equality plan, an internal whistleblowing channel and at least 2% of staff with a disability, or approved alternative measures.
• Time recording: Every employer must keep a daily record of each employee's working hours and keep it for four years.
• Accident insurance: You alone pay the AT/EP contribution, and the rate depends on your activity's CNAE code.

Hiring and employer duties: the whole process, step by step

From first registration to the annual close

• Get your tax ID, tax census entry and activity code, then register as an employer to get your contribution account number: before you hire anyone

• Budget the full cost of the hire: salary, employer contributions, two extra payments, holidays, risk prevention and a severance provision: before you make an offer

• Check hiring discounts and regional subsidies, and see whether a temp agency fits better than a direct hire: before you sign the contract

• Register the worker with Social Security: up to 60 days before the first working day, and no later than the day work starts (earliest 60 days before entry date; latest on entry date)

• Communicate the employment contract to the public employment service: within 10 working days of the start of the employment relationship

• Arrange your workplace health and safety duties: from the first day the employee works

• Settle Social Security contributions through the online system: every month, by the last day of the month in which the work is done

• File the withholding return (modelo 111) for income tax taken from pay: every quarter, by the 20th of April, July and October, and by 30 January for the last quarter

• Start and finish any training you want to claim against your Social Security payments: notify each course before it begins, usually at least 7 days ahead for in-person training; claim by December of the year

• Plan for the extra duties when your headcount reaches 50 or more workers: equality plan, internal whistleblowing channel and a 2% disability quota or approved alternatives: as your headcount approaches 50 workers

• File the annual summary of withholdings (modelo 190) and give each employee a certificate of withholdings: modelo 190 between 1 and 31 January; the certificate before the income tax campaign starts

Documents you may need

Identity and residence

• Tax ID for the employer — Hiring your first employee in Spain: what to register first
• A valid work and residence authorization — Hiring your first employee in Spain: what to register first

Income and work

• Company deed and commercial registry entry — Hiring your first employee in Spain: what to register first
• Registration in the tax agency's census of businesses — Hiring your first employee in Spain: what to register first
• Proof of registration in the self-employed regime — Hiring your first employee in Spain: what to register first
• Proof of authority for the person acting for a company — Hiring your first employee in Spain: what to register first
• The employee's Social Security number — Hiring your first employee in Spain: what to register first
• The employee's completed withholding form — Hiring your first employee in Spain: what to register first
• Monthly payslip for each employee — Running payroll: payslips, withholding and monthly Social Security

Other documents

• Your registration documents from Social Security — What an employee really costs beyond the salary
• The collective agreement for your sector — What an employee really costs beyond the salary

Each article lists the other documents it asks for, where you need them.

Hiring and employer duties: questions that cross several articles

What do I need in place before I can register my first employee?

You need a tax ID, a tax census entry showing your activity start, and an employer registration that gives you a contribution account number. Companies also need their deed and commercial registry entry, and self-employed employers must be in the self-employed scheme.

Can a gestoría handle registration and payroll filings for me?

Yes, a gestoría can act for you in the Social Security online system once you authorise it, but you stay legally responsible. The authorisation can be cancelled at any time. Read "Running payroll: payslips, withholding and monthly Social Security" and "Hiring your first employee in Spain: what to register first".

What happens if my employee starts work before I register them?

Employing someone who is not registered is a very serious offence, fined per worker, and you can also lose subsidies and owe contributions with surcharges. Register no later than the day work starts. See "Hiring your first employee in Spain: what to register first" and "Social Security discounts and subsidies for hiring".

Does a temp agency change who handles registration and cost?

Yes, with a temp agency the agency employs the worker and handles their registration, but you pay for the service and some uses are banned, such as replacing striking workers. Compare the options in "Temp agency (ETT) or direct hire for a first-time employer" and "What an employee really costs beyond the salary".